While Christmas is traditionally the most expensive shopping season, it seems that consumers are becoming savvier with their holiday spending. This means small businesses must pull out all the stops to boost sales and attract new customers to their brand.
But how can you ensure that the money you spend on your public is gifted back to you in the form of profit? A small business bookkeeping service can help you figure out where to cut costs, so you end the year red-nosed rather than red-faced.
Though they are not openly advertised, many wholesalers and retailers will offer small businesses deductions on expensive purchases. What’s more, if you’ve been buying from them for a number of years, the festive season could be the perfect time to negotiate a more favourable deal with your supplier.
You’d be surprised by the number of sellers who will be happy to reduce their prices for you, especially if they know you are likely to become a repeat customer. Work with a small business bookkeeping service to determine which items you need to reduce your costs on the most.
Buying in bulk always seems like the most cost-effective option. But are you really going to use every one of those two hundred staplers you bought on impulse? Sometimes, you can cut yourself a better deal by simply purchasing the items you need. Even if your wholesaler introduces a special festive rate, weigh up all your options first.
With the help of a small business bookkeeping service, you can itemise your spending efficiently. Once you know exactly what you need and in what quantities, you can avoid overspending permanently. While Christmas is the season of good will, it will do you no good to frit away your earnings on unnecessary purchases.
If you’re hoping to make instant returns on your investments, then extending too many lines of credit can slow down money from entering your account. For instances where you are offering credit options to your clients, check that they are good for it. It’s not discourteous to run background checks or ask for letters of credit if you are unsure of a client’s history.
In fact, a small business bookkeeping service will advise you to run credit checks on everyone you service. In situations where you believe credit payments may be delayed, it’s better to ask for cash in advance, only send partial shipments, or take out insurance to be extra safe.
Christmas may be an expensive holiday, but you don’t necessarily have to pay for it all in December. Making early payments may entitle you to some discounts, whilst delaying them could help you preserve a healthy cash flow for longer. Working out a balance between these two payment options will mean you aren’t left short of reserve cash over the festive period.
The longer you hold your funds, the longer they will work in your favour (e.g. accruing more interest in your account). As soon as you pay taxes, utilities and suppliers, the power of this money leaves your control. As long as you aren’t going to incur any late payment fees from withholding these funds, you can benefit from keeping hold of them. Ask a small business bookkeeping service what your best options are, in light of financial forecasts and cash flow projections.